Enterprise Products Partners stock outlook after earnings

Enterprise Products Partners (NYSE: EPD) stock price moved sideways on in the pre-market as investors reacted to the latest earnings. The shares were trading at $26.30, which was a few points below the highest point this year. In all, EPD shares have risen by about 2.70% in the past 12 months.

EPD revenue misses as earnings miss

Enterprise Products Partners is a giant midstream company valued at over $57 billion. The company operates thousands of miles of pipelines that move millions of barrels of oil, refined products, and petrochemicals per day. It competes with the likes of TC Energy, Kinder Morgan, Cheniere, and The Williams Companies.

Enterprise Products published mixed financial results. In a statement, the company said that the net income jumped to over $1.4 billion in the first quarter. That was a smaller increase compared to the $1.3 billion it made in the same quarter in 2022. 

Further, the company’s distributable cash flow jumped to $1.9 billion while its net income soared to $1.42 billion. Adjusted EBITDA rose to $2.31 billion. In a statement, the company’s co-CEO said:

“Across our integrated system we continue to see crude oil, natural gas and NGL production growth from the Permian Basin. Lower natural gas prices, however, are beginning to temper activity and growth in dry natural gas plays such as the Haynesville and Eagle Ford.”

Enterprise Partners is often seen as an all-weather company because of its stong market share in the US. It also does well in virtually all market conditions. The only year where its revenue declined was in 2020, when it moved to $27.2 billion. It then bounced back to $40 billion in 2021 and to $58.1 billion in 2022. 

Analysts expect that the company’s revenue and earnings will stabilize to pre-Covid era. Expectations are that revenue will drop to $55.7 billion in 2023 and then rise to $57.45 billion in 2024.

Enterprise Products Partners stock analysis

EPD chart by TradingView

EPD stock has been in a strong bullish trend in the past few months. Precisely, the shares have jumped by more than 44% from the lowest level in December 2021. The stock is now sitting at an important level since it was the highest point on February 16 and June 8 last year. It remains above the 25-day and 50-day exponential moving averages.

Therefore, I believe that more upside for Enterprise shares will be confirmed if it moves above the key level at $26.60. This will push the shares to the next psychological level at $30.